Neurocognitive deficits in schizophrenia can serve as bridges for exploring basic biology on the one hand, and functional (e.g., social) outcome on the other. This application is a competitive continuation in a program of research that has focused on deficits in early visual processing in schizophrenia, assessed with visual masking procedures. Visual masking occurs when a briefly-presented visual target is obscured by a visual mask that is presented shortly before or afterwards. Schizophrenic patients show deficits on visual masking tasks, meaning that they have more difficulty than controls in identifying the target in the presence of a mask. In the proposed project, we will explore both the underlying neural substrates and associations with social outcomes. We will recruit 3 groups of subjects: 120 schizophrenic patients, 70 of their siblings, and 70 normal controls. These groups will receive diagnostic interviews, several conditions of visual masking, electrophysiology, measures of social cognition and functioning, and a subgroup from each sample will receive functional magnetic resonance imaging (fMRI). In addition to these groups, a sample of recent-onset patients who have already participated in the current study will be assessed over a four- year follow up period. The underlying neural basis of masking deficits in schizophrenia will be studied in two complementary ways. First, we will record event-related gamma activity (i.e. electrical activity in the 30- 70Hz frequency range) concurrently while subjects view masked and unmasked target stimuli. We have previously suggested that visual masking deficits in schizophrenia may, at least in part, be due to a failure to establish and / or maintain gamma activity. Second, we will examine the regional brain activity associated with visual masking through fMRI. For this purpose, we have adapted visual masking stimuli for use in the scanner. We will also consider whether visual masking deficits in schizophrenia have an impact on the daily social functioning of patients. This will be accomplished with assessments of social cognition (abilities needed to perceive, interpret, and process social information) and social functioning.